Stress

[Joe Ross 10]

Do you suffer a lot when you trade? Are you under constant stress from trading? What are your thoughts about stress, and is it a major factor in your trading?

 

Stress in trading is not always harmful, probably depending on the source of the stress. For some traders it is imperative that they run scared. For those traders it is the emotion of fear that can generate the concentration necessary to survive.

 

For all traders, it has been proven that trading is a stressful business. Tests have shown that even when traders appear calm, relaxed, and comfortable during trading, their heartbeat rises, blood pressure rises, and skin moisture increases.

 

In other fields we see constant demonstrations of performing under stress. It is the ability to thrive under stress that sets athletic superstars apart. It is the ability to go onstage when a person's stomach is full of butterflies that can make a stage performer into a star.

 

An effective trader learns to handle stress. His natural instinct of self preservation is what makes him effective when challenged.

 

There are other forms of stress besides fear. Selfishness can cause a trader to fight greedily for what he thinks he must have. Such a trader will trade without any consideration for personal honesty. The attitude of this kind of trader is "get what you want. Win somehow."

 

As a trader you must find out who you are and learn to accept yourself that way, or better yet, change; become a better person.

 

Regardless of the source of your stress, if you are going to trade effectively, you must face the cause of it and learn to deal with it.

[Minetoo 10]

Joe, first off let me commend you - 50+ years trading!! That is phenomenal, no doubt you have a lot to teach us. As per your topic, I too suffer from stress (but it is self-induced). I have a nasty trading bias for the long side of everything, 'perma bull' in other words. Do you have any ideas on how I might overcome this ridiculous bias of mine?

[james_gsx 16]

  Minetoo said:

Joe, first off let me commend you - 50+ years trading!! That is phenomenal, no doubt you have a lot to teach us. As per your topic, I too suffer from stress (but it is self-induced). I have a nasty trading bias for the long side of everything, 'perma bull' in other words. Do you have any ideas on how I might overcome this ridiculous bias of mine?

 

Come up with a system that fits your personality for trend and choppy markets then focus on looking for setups to both sides. Personally I like the idea of other people panicking so I tend to look for more short setups. Really it just comes down to screen time, the more you get the more you'll see setups from both sides.

 

 

Or when the market is trending down you can just turn your monitor upside down :o

[aiki14 10]

I think if your hard earned money is at risk you're gonna have stress. The key to surviving is to have mechanisms in place to reduce the stress during trading, and to have decompression strategies when not trading.

If you're really stressing during trading, reduce your risk, or shrink your positions to a tolerable level.

For decompression, find an activity that helps you, for me it's Aikido training or long bike rides. Things that require focus so you can work off the stress while thinking about something else.

if you're hitting the Prevacid and Tylenol or worse alcohol or other drugs, you have to step back and evaluate what your goals are, and what your tolerance is. Killing yourself is not a good idea.

[Joe Ross 10]

  Minetoo said:

Joe, first off let me commend you - 50+ years trading!! That is phenomenal, no doubt you have a lot to teach us. As per your topic, I too suffer from stress (but it is self-induced). I have a nasty trading bias for the long side of everything, 'perma bull' in other words. Do you have any ideas on how I might overcome this ridiculous bias of mine?

 

GSX and Aiki both have good points and GSX has a very valid point when he says turn your screen upside down. From a real incident with one of my students I can tell you that capturing the chart and turning it upside down is one way to solve your problem. Of course you will also need to turn it mirror image so that the prices are where you expect to see them.

 

One other student who had that problem solved it by listening repeatedly to the CD "Trading Mind." It is available from many websites including our own.

 

Repeated affirmations of the kind included on the CD work extremely well for some people. But you must do them hundreds of times.

 

There will always be some stress as noted by Aiki, but you can learn to subjugate that stress and make it work for you rather than against you. If you believe in yourself and in your trading plan, eventually the stress will work in your favor.

 

Interestingly, the majority of traders prefer to be short. With the exception of currencies, prices move down much faster than they move up.

 

Cheers.

[torero 10]

  Minetoo said:

Joe, first off let me commend you - 50+ years trading!! That is phenomenal, no doubt you have a lot to teach us. As per your topic, I too suffer from stress (but it is self-induced). I have a nasty trading bias for the long side of everything, 'perma bull' in other words. Do you have any ideas on how I might overcome this ridiculous bias of mine?

 

One of the best cures for biases was when I decided to use mechanical trading to test our my so-called "great ideas for tomorrow". Dang it, it was mind-blowing to see how many bad ideas I had in my head (I won't go into others' but it was enough). By using the facts, I figured out that biases are the causes and quickly dropped the biases after seeing the facts for myself. You dont' have to be a programmer; a few lines of code on TS will be enough to prove or disprove your biases.

[Minetoo 10]

Thanks folks for all the advice. Now I have one monitor right-side up and the other upside down.:o